DETROIT, SEPT. 17 -- The United Auto Workers today reached tentative agreement with General Motors Corp. on a new labor pact containing a job and income security program that could cost the automaker an estimated $4 billion over the life of the three-year contract.
Emerging from a marathon 41-hour bargaining session early this morning, neither side would release any details of the new contract until it had been approved by the union's GM bargaining council in a meeting scheduled for Tuesday morning. But details of the pact began to emerge yesterday.
Outlines of the job security program, according to sources, indicate the company has agreed to double the amount of money it spends to guarantee either the jobs or incomes of senior employees. Union sources said the cost of the new security program would be $4 billion, an increase of $2.3 billion over job security spending in the previous three-year contract.
The company had initially proposed a program in which job guarantees would be offered to any worker with 20 or more years of service, about half the 280,000 active UAW employees at GM. The union wanted the seniority level dropped to 15 years, which would cover approximately 75 percent of its GM members. The agreement is reported to have set the seniority level at less than or close to the 15-year level.
Workers with less service would have to "grow into" the job security program, but no current employee will have to work beyond the next two years to come under the job protection program. It was unclear how long new hires would have to work to gain protection, but with 30,000 UAW members on indefinite layoff, there are not apt to be many new hires over the life of the agreement.
As an inducement for more senior workers to leave the company, monthly pensions for early retirement were raised from $1,500 to $1,800 a month and restrictions on outside earnings were eased. UAW members taking early retirement would not be covered by the contract requirement that GM hire one employee for every two who quit, died or retired. The two-for-one formula was retained in the new contract.
The contract also provides lump-sum payments for current retirees to help them keep pace with inflation.
The wage package, which never emerged as a major issue in negotiations, calls for a 3 percent increase in basic wages the first year and then lump-sum payments of 3 percent at the start of the each of the last two years. Unlike the first-year increase, the lump-sum payments do not roll into the employee wage base. The average UAW worker at GM now earns $15.75 an hour, including the cost-of-living adjustment, which the new contract continues.
In the health care area, there were few changes and the union successfully resisted a company demand for co-payments by union members.
GM did succeed in eliminating the $600-a-year bonus employees currently receive for having perfect attendance records each year.
But UAW President Owen Bieber and UAW Vice President Steve Yokich differed over how the money the company saved by not paying the attendance bonus should be spent. The company offered to use that money and savings from other areas to give union members at least two extra holidays. Yokich wanted the holidays, but the rest of the committee members wanted to use the money to pay the rank and file what amounted to a signing bonus once the contract was ratified. Bieber sided with the committee.